Rio says seen no evidence for China detentions

By Rob Taylor

CANBERRA (Reuters) - Anglo-Australian miner Rio Tinto said on Tuesday it had yet to be presented with any evidence to support the detention of four of its China-based staff on suspicions of stealing state secrets.

The mining giant said it had also not been informed of any charges against its detained staff, which include Rio Tinto's top iron-ore salesman in China, Australian Stern Hu.

Hu and three Chinese colleagues were detained a month ago on suspicion of spying on Chinese steel mills. Rio, the world's second-largest iron ore producer, and Anglo-Australian firm BHP Billiton,, the third-largest producer, are currently locked in iron ore price negotiations with China.

"We are still not aware of any evidence that would support their detention," said Rio's iron ore division chief Sam Walsh.

"We continue to be concerned for the health and welfare of our three other employees detained at the same time as Stern Hu," Walsh said in a statement, noting that the Australian government had informed the company that Hu was well.

The Rio detentions have cast a shadow over Australia-China trade, worth $53 billion in two-way terms in 2008.

In a growing war of words between Australia and China, Smith delivered a veiled warning on Tuesday for Beijing to rein in its diplomats after its embassy tried to block a speech in Canberra by an exiled leader of China's Uighur Muslim minority.

An online article published in a magazine run by China's state secrets agency at the weekend said Rio spied on Chinese mills for six years, resulting in the mills overpaying $102 billion for iron ore, Rio Tinto's biggest earner.

The Australian government on Tuesday brushed off the Chinese report accusing Rio of overcharging and spying on Chinese steel mills, saying it had not been officially sanctioned.

"It is now quite clear, given that the article has been taken off the website, that it was essentially the opinion of the individual writer, and not if you like officially sanctioned," Australian Foreign Minister Stephen Smith said.

Rio Tinto's shares were some 2.2 percent lower at A$57.22 at midday on Tuesday, continuing a 3 percent slide the previous day amid investors nerves over the miner's relations with China.

AUSTRALIA-CHINA TIES

Australian diplomats had made a fresh appeal for China to grant legal representation to China-born Hu after they were allowed only their second visit to his Shanghai detention center late last week, Smith said.

"We were very pleased to see that his health and welfare continues to be in good order," Smith told state radio.

Jiang Ruqin, the author of the article that laid out the allegations, said the claim of losses came from Chinese media reports, including his statement that indications that Rio had been spying for six years came from seized computers.